Brian Eno Explains How The Recording Industry Is Like Whale Blubber

from the then-gas-came-along dept

Just before I sat down to write this post, I was having a very interesting (and fun) conversation with someone about the recording industry (someone very deep in the industry, who's been there for many years), who was arguing that selling recorded music needs to be a part of the business model. I was trying to suggest it was a bygone era, and that technology had made the idea that you need to sell music obsolete (though, if you can sell recorded music directly, more power to you -- I just don't think it becomes increasingly difficult). I made the point that technology always makes certain aspects of larger industries obsolete, pointing to the usual example of how automobiles made horse buggies obsolete, but certainly didn't harm the transportation industry. We started thinking up other examples, of industries massively changed by technology, that wiped out segments of that industry, and while I came up with a few, I was definitely searching for better examples.

"I think records were just a little bubble through time and those who made a living from them for a while were lucky. There is no reason why anyone should have made so much money from selling records except that everything was right for this period of time. I always knew it would run out sooner or later. It couldn't last, and now it's running out. I don't particularly care that it is and like the way things are going. The record age was just a blip. It was a bit like if you had a source of whale blubber in the 1840s and it could be used as fuel. Before gas came along, if you traded in whale blubber, you were the richest man on Earth. Then gas came along and you'd be stuck with your whale blubber. Sorry mate -- history's moving along. Recorded music equals whale blubber. Eventually, something else will replace it."

I think we've got ourselves a new analogy worth remembering.

The rest of the interview is definitely worth reading. I won't spoil it, but I will say his thoughts on Bono are quite amusing. Separately, he had an interesting story about when he was producing both U2's last album and Coldplay's last album at the same time... and got scared that the same song would end up on both albums:

"It was fine. A few jokes. I felt like a Â­philanderer who was with another woman and might make a slip and call her by the wrong name in bed. I had one computer that had all of the Coldplay stuff and all the U2 stuff. I had to very carefully label each folder because I was paranoid that I might end up with the same basic track for each group and I wouldn't notice until it was too late. There was a chance the same track might have appeared on both albums."

Given the somewhat ridiculous accusations last year about Coldplay copying music from The Cranky Boards, no, Joe Satriani no, Cat Stevens, this seemed like a fascinating admission -- but one that shows how different musicians might totally innocently end up with similar songs on their albums, not because of any vast copyright conspiracy, but through random other factors.

Peak Whale?

Meh

I dunno, whale blubber is good, but I still like comparing buying recorded music to buying ice.

When the only way to get ice was to buy it, sure people paid a pretty penny for it; Now that anyone can make ice at home, the only people who buy it are people/companies in niche markets. Should be have legislated the refrigerator out of existence so a few large companies could keep their business model?

large fishes

The transition from blubber to oil came with corporate control of government and the rulemakers. This explains why these correctly distilled insights, which make so much sense
will not be considered in the decision making process.

Re:

Another example...

How about valves being replaced by transistors - or the fountain pen being replaced by the biro.. there are hundreds of examples of technology moving on - and businesses having to move on with them or die!

Re: Re: Re: Pirate Concerns

i was considering the plight of the music industry a few weeks ago trying to think of a non-material good that was lucrative and was then disrupted out of existence. the best analogy i could come up with was indulgences sold by the catholic church prior to the protestant reformation.

before martin luther nailed 'Ninety-Five Theses on the Power and Efficacy of Indulgences' to the door of the church, and for a good time afterward, the catholic church would grant you an indulgence, an absolution of your sins, in exchange for money. business was good and this was a major profit center for the church.

for the next 130 years protestants and catholics waged holy war on each other until the Peace of Westphalia ushered in the era of christain tolerance we enjoy today.

fast forward to the beginning of the 21st century and the record industry is out prosecuting heretics who dare question the orthodoxy of 'big content'

the good news is that nobody is being burned at the stake and that a resolution should take less than 130 years.

My favourite analogy for the record industry

Is the overland spice traders - who had an elaborate system of tariffs and markups -each trader taking his own little (or maybe not so little) cut as the spices made their laborious way from the far East to Europe. Then along came Vasco de Gama who found a direct sea route and totally wiped out their trade. The price of spices plummeted.

The nice thing here is that the basic product really was the same - it was the distribution method that had changed

Re: Meh

Re:

Before Gutenberg invented the printing press, only very few rich people had books, because books were very expensive as they had to be copied by hand.

I don't see any monks transcribing books today, so I'd definitely say Gutenberg's printing press disrupted them out of existence.

This is the most relevant example I can think of. The copying of information suddenly became much easier thanks to the introduction of new technology, and the old ways became useless overnight -- compare this to the introduction of the internet and the plight of the CD-copy-and-distribution industry. History is repeating itself.

Re: Re:

This is the overweening characteristic of every single successful
new medium: it is true to itself. The Luther Bible didn't
succeed on the axes that made a hand-copied monk Bible valuable:
they were ugly, they weren't in Church Latin, they weren't read
aloud by someone who could interpret it for his lay audience,
they didn't represent years of devoted-with-a-capital-D labor by
someone who had given his life over to God. The thing that made
the Luther Bible a success was its scalability: it was more
popular because it was more proliferate: all success factors for
a new medium pale beside its profligacy. The most successful
organisms on earth are those that reproduce the most: bugs and
bacteria, nematodes and virii. Reproduction is the best of all
survival strategies.

to me, this is the crux of the issue. Recording Industry Music (TM) just isn't made for digital distribution, and since the market has moved on to digital distribution, The Recording Industry Inc. should stop making Recording Industry Music(TM) and move on to something more organic.

it costs too much to make mass market radio tunes and they don't hit people in a manner that gets them behind it. True Fans(TM) get behind music that speaks to them and that mass market stuff isn't going to cut it anymore.

Re: Meh

Your ice analogy doesn't work. Here's why:

The ability people now have to easily make ice at home does indeed eliminate a lot of the market for the large ice-makers and these ice-making companies may decide to stop producing ice. It's important to note that this won't affect people's ability to continue making ice at home.

Music however is different because pirates don't make music at home from scratch in the way that people make ice from water, they clone existing creative content. If artists decide it's not worth it to publish their work, there is nothing for these pirates to clone at home.

My instinct tells me that there is a bigger plus side than down side to freely available digital music, but we sure haven't found the recipe yet. Free music is ok for big bands who can shift their revenue focus to concerts and ancillary sales of t-shirts, brand licensing, etc. Free music also works for struggling new bands because it gets them heard when otherwise they likely wouldn't be. The problem area is in between these extremes - the bands who are just beginning to make it big and are in need of label-style promotion. If these bands don't have a good revenue model, the investment in promotion won't happen. My worst fear is that the labels will then 'manufacture' even more shit like The Jonas Brothers while the real artists flounder.

This makes no sense to me, please explain.

On Techdirt, music and the recording industry are always the target, which I am completely fine with, but it's being built into a straw man as of late - if we were talking about software, of which there are many software pirates, then how would all of this logic apply?

Is it Microsoft's short-sightedness that allowed me to illegally download Windows 7 (don't worry I didn't)? Was it their fault for not offering me some type of easy, online access to buy and electronically transfer Windows 7 to my local drive to install later?

We seem to be saying this about the recording industry, but I'm curious to see how Mike would apply this argument to software companies, who need to sell their software to make money, and are just not worried about some royalty clause that was inserted into the contact.

I say this because I work for a software firm. We need to sell our product to make money, how does downloading an illegal copy of our software compare to downloading a free song, or a free album or 100 free albums?

I can certainly tell you that most software companies are not in the business of offering a "taste" just so you can maybe purchase something later. (http://techdirt.com/articles/20100125/0825377891.shtml)

Re: This makes no sense to me, please explain.

Hmmm, have you heard of time limited demos and crippleware? They aren't the full version, unlimited version, but they certainly are a "taste" of the product. However, that said, I do see your point that most software companies aren't going to be selling t-shirts. There are other options, such as support contracts and such.

Re: Re: This makes no sense to me, please explain.

"They aren't the full version, unlimited version, but they certainly are a "taste" of the product."

To clarify, I used "taste" in the context of the referenced article, which was to say (albeit theoretically) file sharing offers people a glimpse into what's out there, and once they find what they're looking for, they make a physical purchase.

Musicians have plenty of songs, so one or two might be considered a drop in the bucket, and may even lead to full sales of the album. But some software companies only have one product offering (thank god not mine), and while you could claim it's their fault for not having a wider product line, most startups come into existence going all in on one thing.

Re: This makes no sense to me, please explain.

Software is different for three reasons

1) Most programmers write bespoke code (always have - always will). You are unusual if you write for a company that sells "off the shelf" software. So although there may be an issue for software companies - there isn't an issue for programmers like there is for musicians.

2) The free software movement has reached critical mass already. Few people need to buy software now. There is no need (and in my opinion therefore no excuse for piracy except in a few specific circumstances). If your company is still able to make money selling software then it must be offering some good "reasons to buy" (eg support) already.

3) Major companies like Microsoft already give their stuff away to large groups of users. I still use their (some of) their products - but only because to me they are free.

Re: Re: This makes no sense to me, please explain.

People aren't interested in Support offerings of a software company. It might be a nice perk, but they expect the software to work...No one makes a purchase based on the fact they might have a good encounter once the software fails, they choose the least buggy software and forget about Support unless they absolutely need to.

Re: Re: Re: This makes no sense to me, please explain.

Better Analogy - Radio to Television

I always thought the horse and car analogy does not quite work with what is happening in the content space.

Maybe a better example is what happened to the radio industry when television came along. Radio is still around but has greatly morphed into niches and has had a long history of struggling. (I may suffer from nostalgia but the shift has not made radio better).

The Internet made the entertainment space more crowed with other options for consumers. Instead of sitting around listing to the latest Pink Floyd album, we can surf the net (play hours upon hours of video games) or many other options.

In terms of music – there are many factors that would cause sales to drop:

* Other forms of entertainment (many free)
* Ability to buy one song instead of a whole album
* Less volatile music collection (I don’t need to keep replacing scratch CDs anymore)
* Easy access to other music. It is now so easy to find older albums that new artist are really competing against a much bigger playing field.
* Piracy – A greatly inflated problem but still a problem

I think with a much more crowded entertainment space and people being suckers for free, other established content provides are going to see contracting markets.

Re: Re: Re: This makes no sense to me, please explain.

Please explain how your comment deals with the reality of open source products, where entire companies revolve around free of charge software. Red Hat, et al. make their money from these support contracts that you claim nobody buys.

I love

Re: Another example...

Or, rather than move on or die out, you find a smaller niche you can be successful in. Such is the case for valves which, even with advances in digital modeling, find happy homes in guitar amps and high end audiophile equipment.